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The Willis Report

News/Business. Host Gerri Willis.

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01:00:00

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San Francisco, CA, USA

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Comcast Cable

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Virtual Ch. 130 (Fox Business)

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mpeg2video

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ac3

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704

PIXEL HEIGHT
480

TOPIC FREQUENCY

Grover 7, Us 7, Gpa 4, Groupon 3, Legalzoom 3, Gerri 3, Charlie 2, Robert 2, Doug 2, Steve Forbes 2, India 2, Duracell 2, Detroit 2, Lte 2, Obama 2, Janet Long 2, Lorenzo 2, Gaviscon 2, New Jersey 2, Washington 1,
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  FOX Business    The Willis Report    News/Business.  
   Host Gerri Willis.  

    March 3, 2013
    10:00 - 11:00pm EST  

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[laughter] of. >> that is an excuse for the researchers to get drunk. >> it would explain so much. >> one point* $5 million to develop a solar panel like. real or fake? >> you are killing it break. annihilating the competition spinach you cannot have a solar powered bike. >> that does not mean they don't study it. >> $1 million for a wax museum in national. >> you got one right. [laughter] that is fake. final jeopardy. $100,000 for review game
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about aliens saving plan is to climate change. real or fake? >> what is the answer? >> israel. you are the winner of this court is an authentic and bloodied meat cleaver. >> no way i can leave the building with that. the moment i walked out i've arrested by security. [laughter] john: it is silly but it makes a point* the next time politicians say recant that remember there's so much garbage sometimes you cannot tell what is fake. that's our show. thank you for watching. i am john stossel. good night. willis is up next.
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gerri: tonight on "the willis report," the most ridiculous resignation letter ever, the ceo's words like you never heard before. also, some colleges don't care about gpas, what they are really looking for. is jcpenney dead? what happened to the iconic american bran, and can it rise again? "the willis report" is on the case. ♪
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gerri: no, no, that didn't happen, just kidding. there's no apocalypse. despite the white house making wild doomsday predictions if the automatic spending cuts, today, the sequester is a snoozer. the house and senate are not in session today. with more on this, grover nor qis, douglas holtz-eakin, and a former cbo director and steve forbes, chairman and editor in chief of forbes media, starting with you, sir. surprise that we're still here? that western civilization continues as we know it? >> oh, absolutely, and i think they've got all the apocalypse talk because if you do a small cult, we lived with it, why not do more, and so we saw in new jersey, we have a budget today with the governor, governor christie, lower than it was five years ago. the sun still comes up in the morning in new jersey, we have
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occasional storms, but we survive. gerri: absolutely. grover to you. look at it. we have the payroll tax increase for so many working americans at the beginning of the year. isn't it only fair that the federal government goes on a bit of a diet, too? >> well, one of the challenges, of course, is the federal government's been on a binge, and just beginning to bring it back, obama thinks that makes the world collapse. we could absorb a lot more budget restraint if it was done through reform in government. the republican budget, the ryan plan saves $6 trillion over the next decade. this is only 1.2 trillion. it's done awkwardly, but the republicans have a plan to do six times more in savings by reforming government. obamaments to cut -- obama wants to cut it with a meat cleaver a little. gerri: doug, it's not planned reform or sought out reform. it's a mistake, and we're all
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going to live with it, and it's going to be fine, but ated -- at the end of the day, it's not that much money.@ it's about 2%. what do you think of it? >> it's much to do about nothing. it's really 2%. you hear talks of a recession. i've done the math. if this causes a recession, the stimulus bill should have traded 6 trillion in wealth. we have not seen that. i'm pretty sure we're safe from recession, and the reality is, we can absorb these cuts from the federal government. they are going to be some ough edge, but by and large, we're still going to have more spending than we had last year, more money than the president, himself, budgeted. gerri: to that point, take a look another the chart, cbo numbersment the spending continues to rise with the cuts. keep in mind, this is not a cut in spending. when people talk about the sequester being spending cuts, it's not spending cuts, but reduction in the growth of federal spending -- ha-ha, i just love the story because at
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the end of the day, people are so confused about this, and they don't know what to make of it. fitch and s&p says it's not changing the ratings here. >> yes. i think the white house is beginning to realize they overplayed their hands on this thinking the republicans would cave as they have in the past x and when they didn't, they were unprepared for it, and they are scrambling to say it's a long process, so if the world ends in a hundred years, it's because of that sequester. gerri: right, exactly. we're supposed to get news of the president signing this by 7 -- in the 7 p.m. hour, that's the expectation now, the new news, this hour, and i want to tell you, the devil's in the details; right, guys? >> yep. gerri: the architects of capitol hill, the architects of the capitol, that's the job title, saying there's no furloughs. if you were worried somebody else there would be laid off, you know, a maid, somebody cleaning the toilets, it's not going to happen. that is the good news. grover, to you.
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therewas a meeting with the leadership that lasted 45 minutes. the last one lasted about seven minutes. is there going to be a coming together ever of the two sides? >> well, the republicans would like to see a smaller expenditure by the government and lower taxes. president obama's made it clear in his four years he wants higher taxes and more spending. if somebody goes west and east, it's a little hard to talk about what they can agree on. certainly, we ought to be working on regular order, the house and the senate with the president signing bills. the party here is the democrat controlled senate. everything we hear about it is the republicans in the house passing legislation, and the president, liking it or not liking it, but there's 20 # democrats up for reelection in the senate in 20 # -- 2014. they are hiding.
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they have not done a budget in four years. we ought to shine a light over there and see what they do with their spare time. gerri: unbelievable. unbelievable. it's your legal obligation to come up with a budget, and you sit on your hands. i don't understand it. listen to this statement from the president about blame. >> sure. gerri: listen to this. i'll get you a comment. >> i put forward a plan that calls for seris spending cuts, serious entitlement reforms, goes right at the problem tha is at the heart of the long term deficit problem. i offered negotiations around that kind of balanced approach, and so far, we've gotten rebuffed because of what speaker boehner and the republicans said is we cannot do any revenue. what more do you think i should do? gerri: it's not my fault, doug. i mean, come on. my hands are clean here. that's what the president's saying. >> the only balanced budget you
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will see will be from the house of representatives in a couple weeks to balance in the first ten years. what you see coming from the democrats is higher taxes, more spending, more debt. there couldn't be a bigger difference. the president has not put out serious entitlement reforms, but taxes. if you say heads or tails, mr. president, and he says taxes. at some point, you have to think of something else as a solution to problems. going down that route is damming to the economy and does not address the budgetary pressures. gerri: steve forbes, to you, is it damaging the economy? >> no, it's the firs good news for the economy in a long time in the sense it's not taking resources out of the economy. where does the government get money? from you, either through taxing, borrowing, or printing money, another form of taxation. the president thinks taking resources from the productive people and putting it in the hands of bureaucrats. it's a little small piece of
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good news we've had. gerri: for the stock market, it's good news. a couple very good days this week. >> it's like the bad wife syndrome, beating stops for awhile, oh, my goodness, this is not bad. [laughter] gerri: funniest thing i heard all day. the president was just full of good statements today in the press. he said something about not being a dictator, grover, getting you to respond to that. listen to this. >> i am not a dictator. i'm the president, so, ultimately, if mitch mcconnell or john boehner say we have to go to catch a plane, i can't have secret service block the doorway. the fact they don't take it means that i should somehow, you know, do a jeddi mind meld. gerri: well, where are we going here, grover? >> the president is confused and shaken up. this sequester was his idea.
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i know he roughed up woodward and wishedded he had not said this, but we know it was his idea. the president thought that -- he signed the legislation to put this sequester into effect. he thought it up. he signed it. he did this ology -- instead of the reforms the house of representatives wanted. this is what he did instead of the reforms in the ryan budget in some form. he thought the republicans would recoil because defense spendg would not have it, he watched too much cable television with a handful of republicans who would faint if they didn't get every penny, but there's just four of those people. they don't represent the modern republican party or the american people. gerri: well, i got to ask you guys, tonight, right here, commit yourself, do you think what's happened with the
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sequester here today, likely to see the president sign within the hour, is it apocalypse now, or is it pocalypse not? if not, raise your hand. i want to see you. on the record, here, come on, guys. apocalypse not? grover? looks unanimous. >> in the apocalypse, i thought the good guys won, no? [laughter] gerri: oh, all right, well, you know, grover, i'd expect you to come up with the detail there. thank you so much. great to have you here. >> thank you. gerri: here's the question tonight. when it comes to the automatic spending cuts, the sequester, apocalypse now or not? vote on the right hand side of the screen, and we'll share the results at the end of the night's show. we'll see how you vote. a stark reminder what happens with fiscal mismanagement. michigan's governor declared a financial emergency in detroit. the city's broke, and on the brng of becoming the largest
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city in the country to have a state take over its finances. we talked both the issue last night, and if you missed it, renowned journalist and author, charlie, laid out in clear terms what went wrong if the motor city. >> a lot of things. there's a big racial issue that we never confronted, like, the south did, anddownons took -- unions took a bite, management whept with it, made bad cars, japanese made the good cars,oil embargoes, trade pacts, a lot of things all at once. dwaight comes, boom, the real estate collapses. the whole country feels the lack of manufacturing now i think. gerri: detroit was once the fifth largest city in the country, but a quarter of the population left in the last decade now ranking 18th. sad story. well, more to come in the hour incoming the downward spiral of
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the most popular retail chains in american history. is jcpenney dead? one of the most talked about exits from a ceo ever. next, why i think the former head of groupon sounds like a 10-year-old. ♪
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♪ gerri: when it comes to saying good-bye, there's very memorable departures. who could forget the fed up flight attenadapt who pull the emergency flight on the last day, even grabbing a beer before going feet first down the slide. we just had another high profile departure, not quite as dramatic, butt -- but the ceo of groupon was fired after a terrible earnings report. the "washington post" declared the ceo writes the best
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resignation letter ever. i actually think it was one of the worst. it sounded like something written by a 10-year-old, so we have a special guest tonight to read the resignation letter. 10-year-old actor who recently starred as young charlie chaplain in the broadway muse calg. take it away. >> people of groupon, after four and a half intense and wonderful years as ceo of groupon, i've decided i'd like to spend more time with my family. just kidding. i was fired today. if you're wondering why, you have not been paying attention from controversial metrics in the s1 to material weakness to two quters of missing our own expectations, and the stock price that's hovers around one quarter of the listing price. the events of the last year and a half speak for themselves. as ceo, i am accountable. you are doing a amazing things as groupon, and you deserve the
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outside world to give you a second chance. i'm getting in the way of that. a fresh ceo earns you that chance. the board is aligned to be beline the strategy we shared over the last few month, and i've never seen you working to the more effectively as a global company. it's time to give groupon a relief valve from the public noise. if there's one piece of wisdom at the simple pilgrim would like to impart upon you, have the courage to start with the customer. my biggest regrets are the moments that i let a lack of data override by intuition on what's best for our customers. this leadership change gives you some breathing room to break bad habits and deliver sustainable customer happiness. don't waste the opportunity. i will miss you terribly. love, andrew. [applause] yeah! ethan, way to go. >> tong. -- thank you. >> well done, wow. not what you expect from a ceo of a company; right?
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it lacks. others did it better like steve jobs who wrote this, i believe apple's brightest and most innovative days ahead of it, and i look forward to watching and contributing to its success in a new role. that was good. even this, the ceo of lehman brothers sounded like a classic guy in the resignation saying, i believe that we've worked together effectively in achieving an prompt -- appropriate transition accordingly. 's time for me to move on resign as chairman of the board. in the end, the ceo is entitled to severance benefits because he was terminated without cause by the board as if chopping three quarters off the share price or abandoned thousands of employees was not good reason to can the executive boy. running a public company is not child's play. investors are not chumps to find your swiss bank accounts, and employees, well they are not
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fellow play mates. later in the show, we asked the lawyers is it legal for a homeless man to sue his parents for his bad lot in life? next, an american retail constitution, and now jcpenney on life support. can it be revived or time to pull the plug? stay with us. ♪ dad, i'd put that down. ah. 4g, huh? verizon 4g lte. 700 megahertz spectrum, end-to-end, pure lte build. the most consistent speeds indoors or out. and, obviously, astonishing throughput. obviously... you know how fast our home wifi is? yeah. this is basically just asast. oh. and verizon's got more fast lte coverage than all other networks combined. it's better. yes. oh, why didn't you just say that? huh-- what is he doing?
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it's delicious. so now we've turned her toffee into a business. my goal was to take an idea and make it happen. i'm janet long and i formed my toffee company througlegalzoom. never really thought i would make money doing what i love. [ robert ] we created legalzoom to help people start their business and launch their dreams. go to legalzoom.com today and make your business dream a reality. at legalzoom.com we put the law on your side. you know how painful heartburn can be. for fast, long lasting relief, use doctor recommended gaviscon®. only gaviscon® forms a protective barrier that helps block stomach acid from splashing up- relieving the pain quickly. try fas long lasting gaviscon®. busy ihere. yeah. progressive mobile is... [ "everybody have fun tonight" plays ] really catching on! people can do it all! get a quote, buy and manage your policy! -[ music stops ] -it's great! well, what's with the... -[ music resumes ] -music? ♪ have fun tonight dude.
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getting a car insurance quote. i'll let it go to voicemail. [ clears throat ] ♪ everybody wang chung tonight ♪ putting it on vibrate. [ cell phone vibrates ] -[ loud vibrating ] -it'll pass. [ vibrating continues ] our giant store and your little phone. that's progressive mobile. ♪ gerri: jcpenney reporting the one of the worst quarters in retail history. is this the end of the road for the troubled company?
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♪ gerri: well, in what could be one of the worst quarters ever,
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ever in retail history, jcpenney seems to be running out of options. where contactually did the retailer go wrong, and does it have a chance to come back? grant, an international sales exterritory, and the author of "the only difference between success and failure," grant, welcome to the show. good to see you. >> good to see you. gerri: any way the company can come back? they made big missteps. >> sure, they can come back. when they -- when they go back to the founding principles of jane cash pen who founded it in 1902 based on customer experience, golden rules of retail, give the customer more than expected, which is not something they pay for. that goes beyond what they came to get with the product and the price, and they completely abandon those concepts. when they get back to that, they have a chance of bringing back customer loyalty. gerri: look, the report was
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sales down 28.4%. boom. i mean, that is bad. i mean, -- >> brutal. gerri: terrible. >> yeah. in a time we have an economy there appears to be recovering and other retail environments succeeding, automobile dealers doing great, macy's improving, radio shack doing well, and jcpenney, a great american brand is suffering, why? it's interesting. gerri: screwed up. >> yeah, well, penny used to say he believed it was criminal, a crime not to sell the customer. when you go to a jcpenney today, you're lucky to get greeted. you won't be acknowledged much less sold anything. gerri: gear they are not about that. we went to the street to ask new yorkers what they thought when they heard the name "jcpenney." this is what they thought. >> jcpenney, cheap clothes. >> not happy with it anymore. >> change. too much change. we want the coupons and sales back. okay?
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>> like she said, cheap, just a cheap undertone now. >> i don't -- it's sad. i don't shop at jcpenney. >> apple computer. >> company clothes. >> jcpenney? gerri: she's a gucci girl. i'll explain something out of that. the fellow who said "apple," referring to the fact that ron johnson was running the company, developed the apple store, highly successful apple store concept everybody loves. it doesn't feel like a store, but a high end hotel lobby or something. why can't he make that translate? what's the disconnect between developing the most successful retail format of the last 50 years, and what's going on right now in a jcpenney store in any city in the country >> yeah. because the answer is a piece of new technology is different than
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the interest in a hanest-shirt, you know? the price drives people to apparel. it doesn't close the transaction, and technology, the gimmick of technology, the interest in new technology, is what drives traffic so when johnson came in and went to the everyday pricing, it's a nice gimmick, but the reality is, you know, you've abandoned 80 years of consumers getting -- being familiar with coupons and immediate sales and discount opportunities, which was driving the traffic. now, jcpenney needs to figure out tow ho take the -- out how to make the sec and third sale. gerri: what do you do? bring back sales, okay, but what else? >> hire company, like myself, come in to turn that company around. seriously -- gerri: that's shameless. >> they would turn it into a sales environment and say, look,
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we're here to make a sale. we cannot create customer loyalty without asisting a client. develop a customized training program for the groups of jcp or penney, whatever they call themselves, have from the front door, a greeting to the department to the cash register all the way to follow-up, and stay with the customer and create a customer loyalty experience that people want to pay for. gerri: if they had sales, people would be back. people want sales. grant, good to have you here, good to see you, mister. thanks for being with us to explain this really sad story. thank you. >> thank you, gerri. gerri: coming up, are colleges changing their criteria for admission? a story every parent should hear. next, we ask is it legal, a homeless man suing his parents saying his bad luck in life is because his parents didn't love him enough. yeah, stay with us.
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gerri: time to update a big consumer story we've been following, and it concerns the fuel economy of cars. the epa wants to make sure they advertise miles of hybrids, matches what you get in the real world. now, the move comes after consumer reports this year said the advertised mileage on hybrids are not realistic. mileage testing is done by auto makers, and the government just signs off on the results, but critics of that process say the numbers don't reflect actual driving habits. when they do, the results are typically much lower. in news tonight, a state department report gives new me men tum to the building of the keystone pipeline saying the project poses no threat to the
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environment. the study is intended to guide the obama administration's final decision on the issue. could be good news. the report was welcomed by backers of the pipeline. no word yet when the white house makes a final decision. could be by the end of the month. we'll certainly cover that for you. well, on to a legal case you're going to love. parents get blamed for about everything these days, but a homeless man in new york is taking family's strife to a new level. 32-year-old aspiring rapper, bernard bay, slams parents with a $200,000 lawsuit because, get this, says they didn't give him enough love. joining us an tern and fox business analyst, leis. this story is crazy. does he have a case in >> absolutely not. once dwrowr a -- you're a man of age, 18, you're
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gone, it's over. to come back at age 32, asking, gerri, i want you parents to mortgage your house to the tune of $200,000 so, what? so i can buy a couple franchises, domino's pizza. do they all spend the night? gerri: you disagree, why? >> it sounds crazy, and he probably is crazy, mentally ill. he's trying to get his family's attention. he said he would drop the suit if they invited him to dinnerment the parents are responsible to provide for him at 32, but, clearly, he received abuse, gone through a lot, and he's trying to get the parents' attention. maybe this is the only way to do it. gerri: wait, getting -- okay, so should this be in the criminal court system? >> no. i'm embarrassed a lawyer took this because, you know, got into the system -- gerri: i think we earlier established --
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[talking over each other] >> anything can happen, mcdonald's coffee, did anyone think a million dollars came from that? let's not cut everything off this way. his parents live in the projects, no money, no one's going to get anything even if he did sue. it's, you know, a mentally ill child that should have had help a long time ago. what are they waiting on? he's now a burden on society. gerri: here's the question. who pays for this? where is the money coming from for this? he's in the court of law, got an attorney -- >> the lawyer -- >> doing it himself, i doubt legal aid would. typed it up himself. >> on a contingency basis. i think they got this filed, they are just hoping -- they won't get 200, but 20,000-something like that. gerri: would settle for $500? >> i think so. can you imagine being in that
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household for dinner? gerri: the mother says she's frightened of her son. did you read that? >> well, yeah, again, another, you know, big sign. maybe you should have gotten him help as a child. he's mentally ill. >> come on. at what point -- >> what about when he was 12 and 5? they just don't happen when you're 32. >> oh, i don't know. gerri: take responsibility for yourself, though? >> here's the problem with that rationale. a slippery slope argument that any time then, if this goes forward, any time a parent missed a school play or didn't wipe a nose properly or forgot the homework or didn't pack a lunch, y can get sued when your child is 32? that's where we are going with this. >> i'm not saying you'll prevail, don't get me wrong, but you can. with this topic, it's clear this man is mentally ill. they should have taken care of it a long time ago as a child, and maybe now he would not be
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homeless living off the state. they have a responsibility. >> public dollars wasted. this is what the judge should do -- throw this out. gerri: okay. we settled this one. i think this is done. you're 32 on your own, buddy. >> yep. gerri: thanks for coming on, great conversation, appreciate both sides of that. how to make your port portfolio sparkle. talking about diamonds, my friend. stick of pushing kids to get good grades in school? turns out, they may not need straight a's to get into the best schools. i'm not kidding. i'll tell you all about it next. ♪ alec, for this mission i upgraded your smart phone. ♪ right. but the most important feature of all is... the capital one purchase eraser. i can redeem the double miles i earned with my venture card
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to erase recent travel purchases. d with a few clicks, this mission never happened. uh, what's this button do? [ electricity zaps ] ♪ you requested backup? yes. yes i did. what's in your wallet?
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♪ gerri: well, it's a number high
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schoolers and parents think about most applying for college, their gpas, but now the nation's most competitive institutions bareey even look at it, meaningless according to the admissions dean at the university of virginia, and the top private college in the princeton review, its admission's dean says the scores are artificial. do students believe that? we have cat cohen, ceo and founder of ivy wise. welcome to the show. should kids stop paying attention to the gpas? >> pay attention to their grades and not so much that average number because grades are predictive of how a student performs in college. grades and rigorousness of courses is what a college looks for. gerri: what you say is that the average really doesn't tell admissions officers enough about your career in high school; right? what is i they are looking for when they are looking at grades? >> well -- so the average, if i tell you astudent is a 3.7, we
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don't know what the student's strengths are, the math/science kid, mew manties kids, and when we hear that gpa, is a weighted or unweighted. high schools weight gpas, so an advanced placement class, they give that an extra point. sometimes, high schools give an extra point, sometimes they give just a fraction of a point. it's hard to understand what that gpa really means. gerri: the number itself doesn't tell a lot. the admissions officers look at the grades over the course of your high school experience; right? they look at where you excelled, where you did well out, there could be a change overtime and grades got better as years went op. >> right. a student with a 3 #.5, that doesn't tell you if they started a 3.0 and ended at the 4.0, looks great, working harder, or is it the reverse. also, what's included in the gpa in terms of courses? are they conning physical
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education? some high schools do that. that can inflate the gpa. it's not accurate. gerri: reason it brings it down. let's talk about what colleges look for. rigor? i have no idea what that means. >> to see if students take the most advanced courses they are eligible for. if your high school offers advaed placement classes or honors classes, do you take advantage of the curriculum? gerri: doing the hard stuff, you get rewarded for that by the admissions officers? >> exactly. gerri: grades are important and considered. standardized test scores. okay, i know people taking sates now, take it once, not twice, once, over and over again, getting the good grades. what's the grade you need and what are officers looking for in the grades? >> generally, looking to see your standardized test scores match your grades. you don't want to see is, you know, a straight a student with very low standardized test scores because maybe that means their high school is, you know, inflating the grades, and you
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don't want to see the opposite either. you don't want to see super high test scores and low grades because the student could look lazy in the classroom. you generally want to see they are the same. gerri: what's interesng in the list is extracurricular activities. what's going on, especially with the ivies, the better schools in the country, they are looking for kids showing leadership at a young age, all kinds of ways to do that, but they want an extensive extracurricular background. >> looking to see how students impact through their interests, and not doing 50 things, but looking at students who choose a few things, divento it, and do them well. gerri: all right. demonstrated interests. what's that? >> that's so important. so many students forget about this. show the college that you're interested in attending the school. maybe you go and visit the school or maybe there's an event going on -- gerri: that makes a difference? >> it does. it does. there's an event going on -- gerri: wear a t-shirt with the
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school's logo on it, and you're in? >> well, unless they see you. there's a lot of ways you can sthoa a college you're interested. gerri: cat, thanks for coming on today. great stuff. >> thank you. gerri: on this day in business history, one the early sensations of the interpret age, yahoo, founded way back in 1995, serving 700 million people, it's the second most visited site after google. widely known for online news, sports, and finance, yahoo reach the the peak closing share price of almost $119 in 2000, and had a market cap of $63 billion. today, the shares closed at -- around $22, a market cap of $25 billion. they were incorporated today, march 1st, 18 years ago. can you believe that? i can't believe that. well, still to come, being too plugged in happens, and up next, going in fashion with a look at a girl's best friend.
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you won't want to miss this. a $50 million diamond collection. no kidding. are they good investments? they are forever, you know. ♪ ♪ why do more emergency workers everywhere trust duracell? duralock power preserve. locks in power for up to 10 years in storage. now...guaranteed.
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duracell with duralock. trusted everywhere. gerri: want to put sparkle in the portfolio? coming up, in fashion shows you how to invest in rare color
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♪ gerri: in fashion tonight, putting glits into investments with extraordinary diamonds.
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in particular, color diamonds, which have grown in popularity over the recent years. joining me now with an exclusive look at a $50 million diamond collectionings brought it right here, is lisa kline, executive vice president of one of the lanchest diamond manufacturers in the world. lisa, welcome to the show. great to have you here. >> great to be here, thank you. gerri: this is my first introduction to colored diamonds, but they are incredibly popular. why are they colored, yellow, pink, blue? >> so, simply put, color is determined by the chemical components that are found in the mines where these diamonds are mined, so, for example -- gerri: in the earth? >> in the dirt and actual earth blends itself to a specific color. gerri: what do you like best here? >> oh, that's a trick question. for me, personally, i lve this two karot vivid blue ring.
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there's a chemical component that makes the blue diamond have a blue hue, and boron is found in the mines where blue dimes are found. it's interesting. there's a very strong scientific component. gerri: the setting is unusual. it's a flower and it's charming. >> it is. we have an in-house team of designers and jewelers, and every pair of stones or collection of stoned received, we sit down with the team, and we really let the diamond do the talking, so -- gerri: let the diamond talk. >> yes, they talk to us. gerri: you got it right. your diamond whisperers. that's what you are. what's interesting is you have pink, blue, yellow, and, apparently, this is what investors clammo for now, why? >> the reason they are interested in the stones is because they are incredibly, incredibly rare. colored diamonds over the past
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few years have become increasingly rare. gerri: the piping one, oh, my lord, it's gorgeous. you'd say pink sapphire, but it's not. >> exactly. that's what people like about colored diamonds because they are somehow less conspicuous than something that's big and obvious. gerri: you don't think this is con speckous, but it's amazing and beautiful. it's pink. how are they pink? >> what's fascinating about pink diamonds and red diamonds for that matter is that there's no known chemical component so it's really due to a structural anomaly within the stone that happens in the earth and -- gerri: comes out like this? >> like that, and cut and polished by the master craftsman. gerri: i'm transfixed. you decked me out here too. i've never seen so many diamonds in one place. this is diamond tie. look at this. just beautiful. i can't imagine how much this costs.
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>> quite a few million dollars right there around your neck. gerri: i have a cuff on, a beautiful diamond bracelet on as well. >> that's a few hundred thousands dollars.. this neckless, 300karots of indictments alone, 800 stones, spent a year and a half collecting each and every win of the stopes, and nine months crafting it into what we like to call, like you said, a diamond tie. gerri: unbelievably beautiful. you collect the diamonds, working with collectors. how do investors pick the right piece? what are they looking for? first, you want to know who you are buying your diamonds from. now, in terms of colored diamonds -- gerri: thought you said who to buy them for. that's also true. >> it is true. that's a trick question too. with colored diamonds, you want to look for stones with the greatest color saturation in the stone so really, really strong,
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powerful colors. gerri: as we saw. now, looking at dimes not colored, what do you look for? these are absolutely phenomenal. >> you're looking for the exact opposite. you want colorless, def color and flawless or near flawless in terms of clarity. gerri: so gorgeous. you have t wonder if they are real they have so perfect, but they are. >> they are. gerri: a lot of diamonds today. is the market growing? what appreciation can i expect from the class? >> so i can tell you that over the past hundred years, diamonds have only appreciated in value. over the past decade, the average diamond hs appreciated 15% per year on average. gerri: 15% per year. no doubt about it, you beat the market with that one, my friend. i mean, stocks did well last year, but not that well. >> exactly. what we do is far from average. these stones, the top tier of colored diamonds and white
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diamonds, they appreciated 100%. that's being conservative. in most cases, stones appreciated almost 200% in value. gerri: i'm imagining myself putting this in my house somewhere. should i keep it under lock and key? how do you care for the stones? >> wear itment i think that's one of the nicest things about investing in diamonds is that it's not only an investment that you keep locked up in a portfolio or in a vault, but it's something with a sentimental element that you can wear, enjoy, that you put on and you feel absolutely beautiful. gerri: they are gorgeous. thank you for coming in tonight. i love the diamonds. absolutely gorgeous. appreciate you bringing them in. >> thank you gerri: you'll notice if i walk away with this, won't you? >> oh, yes, i will. gerri: thank you so much. >> thank you. gerri: great stuffer. the most expensive diamonds in the world, number five, the amond worth $100 million. this has nearly 274karots and
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internally and externally flawless giving it the highest grade for a color less gem. number four, host diamond worth $350 million, the largest blue diamond in the world worth more than 45 # karots on displayed at the smithsonian, which is rumored to be cursed. the culinary diamond worth $400 million discovered in south africa in 1905, the largest rough gem famed. it's more than 3100. the fancy diamond, pear shaped yellow diamond said to be priceless. it is 55karots discovered in india in the 15th century, and the number one most expensive diamond is this mountain of light incursion, and it certainly is, considered priceless and 105 karots. this was discovered in india, but it's older, from the 14th
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century. it's currently owned by the british royal family. beautiful! we'll be right back with my two cents more and answer to the question of the day. when it comes to automatic spending cuts, is it apocalypse now or apocalypse not? i'm serious, we compare our direct rates side by side to find you a greadeal, even if it's not with us. [ ding ] oh, that's helpful! well, our company does that, too. actually, we invented that. it's like a sauna in here. helping you save, even if it's not with us -- now, that's progressive! call or click today. no mas pantalones! it's delicious. so now we've turned her toffee into a business.
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